Economist starting new index at Towson University getting staff from UB to form forecasting system

Academics

March 12, 1996|By Timothy J. Mullaney | Timothy J. Mullaney,SUN STAFF

The entire staff of the University of Baltimore's Regional Economic Studies Program will jump to Towson State University next month, where they plan to launch an index of national leading economic indicators to compete with traditional forecasting methods.

The university hopes that the new index and a new method for forecasting job growth will put its obscure business school on the map, much the way Georgia State University has won notice for an economics team whose inflation forecasting model is widely respected.

The move by economist Michael A. Conte and his staff of 27 follows talks that began last fall. The group will be renamed the Regional Economic Studies Institute, and its budget of $1.5 million in grants, mostly from the state Department of Human Resources, also will move to Towson.

"We want to take our business school to the next level," said Alan Leberknight, dean of Towson State's School of Business and Economics. "We want Towson State to be known as the place to go in Maryland for economic education and information."

Mr. Leberknight, a former president of the Bank of Baltimore, said he was attracted to the entrepreneurial spirit of Dr. Conte, who has built his program into a regionally ubiquitous source of economic data since arriving at UB in 1989.

That entrepreneurial drive will be channeled first into the promotion of the new index of leading economic indicators. Dr. Conte said his group decided to start the index after the Commerce Department privatized the tracking of the widely followed index last year. It is now published by the Conference Board in New York.

"We've developed an index that is much improved," said Dr. Conte, 48, who contended that the Commerce Department/Conference Board index has predicted recessions that didn't materialize four times in the last two decades.

Bruce Grindy, another economist on Mr. Conte's staff, said Towson's Leading Economic Indicators will track 28 indicators instead of the 11 the Commerce Department traditionally used.

In addition, the Towson index will drop coverage of commodity prices, stock prices and money supply, contending that these indicators are especially prone to giving off false signals about the economy.

"The leading economic indicators actually has been predicting a recession throughout 1995," Mr. Grindy said, and none has occurred. "Our index was up, still forecasting growth throughout the year."

Dr. Conte said the institute also plans to introduce an economic forecasting model that will emphasize predicting job growth both nationwide and by region across the nation. He hopes the model's techniques for predicting employment growth will become a national standard, much as Georgia State's inflation model has brought that school a previously unknown level of scholarly respect.

"When you get below the national level, employment data get less reliable and forecasts [of job growth] become less reliable," he said. "That's where we'll be staking our claim to excellence."

Dr. Conte, a Yale graduate whose doctorate is from the University of Michigan, has made much of his career as a scholar of regional economic development. He has taught at the University of New Orleans and the University of New Hampshire, with a tour as a visiting professor at Cornell.

He will not teach at Towson State.

Dr. Conte said he was attracted to Towson because the school has enthusiastically bought into the idea of integrating universities and scholars into the nitty-gritty work of the community, especially economic development. "Towson State is really gearing up to do that," Dr. Conte said.

Pub Date: 3/12/96

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